Willis says insurers won’t get any relief from natural disasters in 2025

Willis, part of insurance broking and HR consulting firm WTW, says natural catastrophes will continue to strain global insurance markets in 2025.

The company’s biannual Natural Catastrophe Review indicates that losses will likely exceed $100 billion this year. Willis says that insured losses now consistently exceed $100 billion and its has been six years since a year with low losses from natural catastrophes.

Insurer budgets were immediately put under massive stress by the Los Angeles wildfires in early 2025, which was the worst wildfire event ever with respect to insured losses, at $40 billion.

This year, Japan and South Korea also experienced the worst wildfires in at least a generation.

Events in 2025 have placed a renewed focus on how wildfire risk is modeled, especially in the urban-wildland interface.

This year has also been the third-most active year for tornadoes in the United States, while an above-average number of storms is predicted for the North American hurricane season.

Cameron Rye director of natural catastrophe analytics at Willis, said, “2025 is shaping up to be one of the costliest years on record for (re)insurers.”

Implicit in the increasing volume and severity of natural catastrophes is the central driver of climate change. Willis says the new era of climate extremes means risk managers have to reassess risk, integrate climate forecasts into their plans, and optimize risk frameworks for evolving threats.

“With global efforts likely failing to keep the temperature below two degrees Celsius above pre-industrial levels, our focus must now turn to adapting and building resilience in the face of this new reality,” said Peter Carter, head of the climate practice at Willis.